High gasoline prices coupled with 2% payroll tax hikes is going to take a bite out of restaurant sales this year. For some chains the slump has already started.

Consider Darden Restaurants, the owner of Olive Garden, Red Lobster, LongHorn Steak House. Darden Restaurant Traffic is down an average 4.5, with Red Lobster leading the pack down 7.5%.

Smaller Plates, Cheaper Items at Olive Garden

At Olive Garden, Smaller, Cheaper Plates are on the way, along with new uniforms including a more contemporary black button-down shirt and black slacks.

Don't worry, endless breadsticks remain.

Olive Garden is also creating a new logo and toning down its the "Old World Style" Tuscan stonework and wooden archways that have been a signature part of Olive Garden restaurants since 2000.

Saturation Everywhere

The main problem is saturation. I see endless miles of restaurants on strips nearby. Those restaurants include Steak & Shake, Red Lobster, Olive Garden, Pizza Hut, Subway, China Express, Chili's, Chipotle, Panera, and other chains intermixed with some local eateries.

If the problem is saturation (and it is), spending money on architecture style changes, creating a new logo, and the new uniform changes is a waste of money, especially the architectural revisions.

People want good food, fast friendly service, and good value.

To pick up market share, restaurants need to lower prices, not make logo changes. And lower prices will take a bite out of earnings. One final point: as soon as restaurants stop expanding (and they will), the hiring will stop with it.

Haruhiko Kuroda, nominated to be the next Bank of Japan governor, said that a central bank under his leadership would do whatever is needed to combat 15 years of deflation.

“I would like to make my stance clear that we will do whatever we can do,” Kuroda, the president of the Asian Development Bank, said in a confirmation hearing in the parliament in Tokyo today.

Prime Minister Shinzo Abe’s nomination of Kuroda has raised expectations for more aggressive monetary easing to revive the world’s third-biggest economy after Masaaki Shirakawa exits the job on March 19. The opposition Democratic Party of Japan, the largest party in the upper house, has signaled it will back Kuroda, easing his passage through a split parliament.

Kuroda said in an interview this month that falling prices exacerbate real debt burdens, and give an incentive to companies and households to postpone spending. Consumer prices excluding fresh food fell 0.2 percent in January. The price gauge hasn’t advanced 2 percent -- the central bank’s new target -- for any year since 1997, when a national sales tax was increased.

Mother of all Pyrrhic Victories

Any country determined to wreck its currency can indeed do just that. However, QE alone will not suffice if all the printed money sits as excess reserves. If QE fails, what's next? More bridges to nowhere?

Regardless, the idea that higher prices are a blessing is blatant stupidity. The last thing aging Japan citizens need is rising prices.

If anything, low interest rates are counterproductive because Japanese savers get zero % on their savings (having less interest income to spend). Sound familiar? It should because Bernanke has the same preposterous ideas.

Once sentiment turns (and it will - but I do not know when), Japan is going to have a hard time preventing the bottom from falling out of the yen. When that happens, the defeat of deflation is going to be the mother of all Pyrrhic victories.

Restaurant food quality seems to have taken a major dive during the Obama years. My wife and I have stopped going out, not so much because of the cost (which has gone up) but because we always walk away feeling ripped off by the quality.

Cooking at home is now not only healthier, it's mandatory if you want anything to eat that actually tastes good.

Restaurant food quality seems to have taken a major dive during the Obama years. My wife and I have stopped going out, not so much because of the cost (which has gone up) but because we always walk away feeling ripped off by the quality.

Cooking at home is now not only healthier, it's mandatory if you want anything to eat that actually tastes good.

I have not set foot in one of those places since they decided not to run ads on conservative shows. m gone for good.

They also caved in to Mooch-elle's dictate for "more healthy" menus from the FLOTUS cow-butt herself. I vowed never to go into any of those restaurants again when they caved in to that overweight dictator-ass.

it’s mandatory if you want anything to eat that actually tastes good...I go to Mexican restaurants around here where I can’t understand them and they don’t know what the hell I’m asking them about. I point at the beer, point at the menu and if I like it, tip like hell. They are always happy to see me, shake their heads ‘No’ if I point at something that isn’t good. Brought some dried peppers in one time and they put it on their own food and stared at me like I was nuts.

The food at Olive Garden is good. The service at Olive Garden in Glendale (CA) is TOO slow for me so I quit going. Our department called in an order for an office party and we still waited almost an hour from the time it was supposed to be ready.

In Ocala FL, just across from the Paddock Mall on 200 (College Road) is what I call Restaurant Row. It is packed with the likes of Olive Garden, Red Lobster, Outback, etc. Chili's is a little down and across the street, and a Carrabba's a little further away going into town. All of them are packed almost every day of the week, almost from opening to closing. There is almost always quite a long wait (unless, of course, you get their when they open).

Only Chili's has seen fit to open another store farther away, but still in Ocala. Whenever we go out to eat, we plan on a non-standard time and figure we will still have to wait about 20-30 minutes for a table.

19
posted on 03/04/2013 11:54:51 AM PST
by jeffc
(The U.S. media are our enemy)

Disclaimer:
Opinions posted on Free Republic are those of the individual
posters and do not necessarily represent the opinion of Free Republic or its
management. All materials posted herein are protected by copyright law and the
exemption for fair use of copyrighted works.